The notes offer also included a £85 million ($130.91 million) tranche sold to UK investors eager for RMBS paper after cheap central bank funding provided to the banks reduced the need for British banks to use securitisation.

The notes were backed by a portfolio of prime mortgages originated and serviced by NAB-owned Advantedge. It is one of two asset backed bond issues launched this week – Westpac launched a $750 million securitisation of receivables originated by St. George Finance.

Related Quotes

Company Profile

Institutional investors are showing a greater interest in mortgage backed securities as yields have declined sharply on other comparable debt securities such as covered bonds. Spreads on major bank covered bonds have contracted from 175 basis points over the bank bill rate in January to below 70 basis points at present, making RMBS relatively more attractive.

The transaction takes the total raised through securitisation by Australian lenders to over $14 billion in 2012.